Fresh start with £150k what would you do?

by Readers Question

16:35 PM, 7th August 2017
About A year ago

Fresh start with £150k what would you do?

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Fresh start with £150k what would you do?

If you had to start all over again from scratch and had £150k as starting pot what would you do considering in this world of additional SDLT and Section 24?

Would you leverage with bridging loans for the flipping company and use those profits generated to buy more properties to flip or would you start to build the BTL portfolio and use the profits as deposits? Or a bit of both?

I can give the investment/business my full time attention and I am based in London with a young family. I would appreciate if someone experienced is able to offer advice and pointers.

Many thanks

RBZ



Comments

Neil Patterson

16:41 PM, 7th August 2017
About A year ago

Property Refurb is a lot more popular now and since section 24 commercial loans and criteria are becoming more available, but dependent on the risk and security offered you may need to prove you have some experience.

Mark Alexander

21:43 PM, 7th August 2017
About A year ago

I would use the money to buy stakes in other people's portfolio's. I would particularly target single individual operators who are looking for somebody to form a partnership with a view to incorporating after three years. There is a lot to be learned from these folks based on their experiences and many have amazing financing deals they couldn't get today. There are undoubtedly some great deals to be done in this market over the next year.

If this business model appeals to you then you really need to read and absorb all of the information I have published in regards to landlord tax. The starting place for this is the page linked below.

https://www.property118.com/tax/

Once you understand all of the different business models and our tax analysis software you will be in an excellent position to present the tax benefits of forming partnership with you with a view to incorporating after three years. You could purchase just a small percentage of beneficial interest in several established landlords portfolio's and your role in the business could be to focus on tax efficiency.

yew tree

8:45 AM, 8th August 2017
About A year ago

I would buy shares in UKOG and ALBA both oil company's

Kay Landlord

9:08 AM, 8th August 2017
About A year ago

I would do a mixture of both - increasing my own portfolio and a bit of development. With regards to joint partnerships, probably start afresh - two experienced property people can work wonders with a bit of pin money. I do like the idea of acquiring some beneficial rights in an existing portfolio, personally I expect a huge amount for very little of my own portfolio to someone. I've had mine for 13 years and when I think of my own struggles learning the game, it has genuinely taken me over 10 years to really understand the business and do it right. We are in for some very interesting times ahead

Adam Withford

9:56 AM, 8th August 2017
About A year ago

I'd use £100 on the highest yielding property I could find (not London).

The rest I would put into Bitcoin & Gold, and let HMRC swing for it.

Chances are you will make 10 times your money with 100 times less hassle in Bitcoin to property, but the property will give you a sense of security.

Anthony Endsor

21:38 PM, 8th August 2017
About A year ago

In all honesty in this day and age, if I was in that position I'd probably just buy a house that needed work cheap, do it up, and sell it on, then repeat. I probably wouldn't even bother with buy to let anymore with all the red tape, etc. I have just recently sold one of my properties and I still have another 4. Thankfully at the moment they're not doing too badly but it does look like buy to let is very much on a downward spiral.

Mark Alexander

22:06 PM, 8th August 2017
About A year ago

Reply to the comment left by Anthony Endsor at 08/08/2017 - 21:38Oh ye of little faith!

Many will sell up and less will invest, granted, but those who do not sell up, especially those who restructure and those who do invest wisely will prosper. Supply and demand will see to that.

Richard U

10:58 AM, 9th August 2017
About A year ago

Today there is a double-whammy that makes property less appealing: 1 - the ability to make income due to tax changes 2 - the ability to make capital gains due to tax changes and a softening property market

With rate rises round the corner as Brexit impacts take hold, the short-mid-term outlook is not good. Personally I would probably hold the money in relatively liquid assets such as premium bonds and peer-to-peer loans, or pay-down debt to reduce debt costs. Maybe risking 10-20% on some high risk investments such as crypto-currency. I'd then be waiting for market-falls to cherry-pick property at best value. I'd do with this with an open-mind to renovation, BTL or FHL depending on property type and potential.

Personally I would avoid commercial property simply because I don't know enough about it, and don't feel i can identify value. Buying is the most important stage of investment for me... if I can't work out what a good price is - then I can't invest.

I know some will continue with BTL - but I don't like it as an investment without gearing - the income is too low for too much work. With gearing, the risk to equity and impact on cash-flow/refinancing of potential negative equity makes it unappealing today (even with fantastic borrowing rates).
Personally I am gutted - i'd really like to expand, but I don't think it's sensible right now.


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